New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1887-06-05
LIKE ANY OTHER CREDITOR.
Mr. ADAMS CONDEMNS THE THURMAN ACT.
DECLARING THAT THE GOVERNMENT SHOULD HAVE
ACTED AS A PRIVATE INvYsroR-A BARREN
SINKING FUND.

DECLARING THAT THE GOVERNMENT SHOULD HAVE
ACTED AS A PRIVATE INvYsroR-A BARREN
SINKING FUND.
BOSTON, June (SpeciaD.-The examination Of Prcs-
dent Adams continued by the United States Pacific
Commission this morning He testified that at the date
at which the Kansas Pacific put into the consoda-
ton, 1t equally valuable with the Union Pacific He
submitted table which showed that while at that time
the Kansas Pacific earning about half as much rs
the Union Pacific 1t has been catching up with the
Union division and now earns twothirds much % the
Union Pacific. The transcontncntal travel has lately
lost its value, that the Kansas Pacific will earn
per mile as much as the Union Pacific The Kansas
Pacific went in the basis OF earnings $4,000 mile
year. and the Union Pacific $4,000 n mile per year.
Now the Kansas Pacific In the proportion OF two to
three He not director at that me but had good
deal to do with the acquiring OF the property One Of his
first efforts upon coming in to clean the outstand
ing bonds The bonds put at 90 bought at $780, and
the buying them in has relieved the company OF heavy
load. He had purchased, since no became president,
$6S0,000 in face value, paying therefore 100000.
These bonds in under the terms OF the c0nso
dalton for about 240000 The consolidation has proved
an immense service TO the community.
4 Referring to branch line business, which he said was
the best business that the Union Pacific did Mr. Adams
said that the Echo and Park City line allowed q
constructive mileage of two miles to which he re-
gardcd too small out iof that road tho Union Pacific
last made $250000 1t had the lions share OF the
business because II had had haul OF 900 miles to
sixty and owing to the In which II received the
business IL was making money every mile, and this
road showed deficit OF $4,000 on IFS fixed charges
Mr.. Adams cited the Of the oregon Short Line to
show how profitable to the main line this branch line
business is and how small share OF the expenses incl
dent TO 1t was borne by the main line The expense he
said mainly borne by the branch lnc which had tn
handl ing distributing and all the incidental work The
profit was therefore, small to the branch ne and 1t
tho main line that got the benefit. Tho Union
n
year and OF that his own impression that about
$s00O00 was net showing the profit Of branch line TO
main line, II the branch limo apparently did not
its fixed charges. As nearly could DO approx
mated from such figures as were in his memoranda, he
inclined to think that the Union Pacific received
from the lines east OF It, about 100000 year in con-
sructive mileage. paid out nearly could be APP
proximated, TO its branch aud other lines west labout
100000 year. The result therefore, that the
pany by the general application OF the constructive mile
age system in throughout the county received about
100000 year more than 1t paid out all of which,of
course was profit and In far this upon the
Union Division. the Government received Its 20 per
cent.
Mr. Adams said that he believed cash had been
paid in the capital stock OF the Union Pacific, II
stood present than had been paid upon the ofany
other existing railroad west OF the Mississippi River No
party In United states he said had begun TO make 50
large an advantage out OF the Union Pacific the Gov
eminent OF the United states The Union Pacific had
been one OF few where the Government went into
business enterprise and got from IL all that'it ever
hoped in any respect TO get FROM It, The entire amount
II advanced the Union Pacific he insisted had been
paid five times over private firm would not
have thought 1t had made bad bargain The Govern
mcnt went into the scheme for given purpose and had
got all that hoped 20 get and far more at an extraor
dinarly moderate cost The company did not object to
paying the Government every dollar principal and In
tcrcst they did object 70 the commonly received idea
E lie
OF tho road the contrary. they considered that the
Government made what private company would nave
considered the fundamentally successful business opera
ton OF IT. life II balance could he struck In court OF
equity II would be found that the United states had
derived from the Union Pacific advantage OF - or
So or even $50 for each dollar that the OF tho
property had derived II the Union Pacific. at the time
maturity OF It's debt 10 the Government In 1897
continued Mr. Adams should be unable 10 pay IT, and
should itself at issue with the Governments upon H.
1t would be through the action Of the Government and
result OF that had been 10 hold the Union Pacific re-
il had protested. in which did not ILecyc, and which
working To nothing bat disaster g. ,,, r,,,,o ,,d
because the Union Pacific had been paying dIyldenis
prior Iesi that before the passage OF the Thurman
act the Union Pacific had been making no provision
whatever for paying the Government debt That " had
been. in fact squander1ng It's means, dividing them
among the stockholders That not the truth. Tho
Union Pacific. up 10 the year 1851. had been simply
making the best and safest provision 10 pay the Govern
ment establishing It's own sinking fund although called
by another name and II IL had been allowed 20 20 on IN
that course he had question in his own MIND 10 what
the result would have been. The Government saw III 10
Interfere II 10 had been content with occupying tho
position Of the ordinary creditor and saying to It's debtor
We have "A lien on your property Go ahead. Manage
the thing In your way, but IT, when tho Gay OF
maturity you cannot us, we propose 70 snow
you no mercy" The company would nave hhd no ilght
whatever 10 complain Instead OF taking that course,
the Government took from the company the money
which q was putting into It's railroad Development IN
which IL accommodating az the rate or 10 IL or 10
per cent and locked II up IN the Thurman act sinking
funds which, the originator OF that fund was on record
as saving he expected 10 accumulate at per cent
year and which In reality barren sinking tund
lie objection 20 having the Union Iaclnc held 10
the most responsibility II II were allowed freedom
OF action until time It's debt matured. The construc
ton OF competing lines going on because the Union
Pacific could not defend ITSELF while, II he had the
money to put into the business which had been turned
into the sinking fund he could transform the business
within n year by developments west OF Cheyenne
The commission then closed its Boston session ana az
/ D. H. Commissioners Pattison and Anderson lott inc
civ the former for Philadelphia and the latter for New
York Commissioner Littler had previously gone west
The ne meeting will be held on June 20 at Omaha, ana
on July g. the commission will begin the inspection OF
branch Francisco. According TO Mr Ander
con, commission will have some thirty days WORK
Another session Ia Boston will probably be held IN
October.
ONE ADVANTAGE OF THE INTERSTATE LAW
ST. LOUIS, June 4-The Chicago. Burlington ana